This year, the global stock markets are picking up where they left off in the final months of last year – they are climbing upwards, defying a number of uncertainties that hang like dark clouds on the horizon. Most of the influencing factors are beyond the control of the companies themselves. On the one hand, geopolitical conflicts such as those in Ukraine and the Middle East or the constant skirmishes between China and the USA are rampant. On the other hand, stubborn inflation figures and strong labour market data have recently prevented central banks from making their first interest rate cuts. Current forecasts predict that the ECB will cut interest rates for the first time in June and the Fed in September at the earliest. At the beginning of the year, March was still the target. Last but not least, this year is also a super election year. This means that a lot of political power will be redistributed. Eyes will be particularly focussed on the elections in the USA and the EU, with the outcome of the former likely to cause more of a furore. Nevertheless, we are experiencing a bull market on the stock market, which has found a spearhead in shares relating to artificial intelligence. Just recently, NVIDIA once again surprised positively with its figures, driving the share price upwards. Investors can therefore look forward to more than doubling their investment since the beginning of the year. For fans of the Austrian stock market, too, an investment has already paid off this year despite a slow start to the year. Financial stocks were the main reason for this. They are benefiting from the delayed interest rate cuts. It is therefore not surprising that two banking stocks, BAWAG Group and Erste Group, lead the ATX performance ranking. The two companies are joined by OMV, another heavyweight in the Austrian leading index, among the top performers. After a disappointing year in 2023, the energy group surprised positively with its earnings figures this year and thus attracted investors back to its side. Together, the three companies make up well over 40 per cent of the ATX and thus account for a large part of the very pleasing annual performance. The low valuation of the domestic stock market continues to offer upward potential for the future. Whether this can be realised will largely depend on whether we experience a cloudburst or whether the dark clouds on the horizon dissipate.
Author:
Karin Kunrath, Chief Investment Officer of Raiffeisen Capital Management*
6 June 2024
 |  |
Note
Wiener Börse AG would explicitly like to point out that the data and calculations given in this report are historic values, which do not permit any conclusions as regards future developments or value stability. Price fluctuations and loss of capital are possible in securities trading. The contribution is the personal opinion of the analyst and does not constitute a financial analysis or a recommendation for investment by the exchange operating company, Wiener Börse AG.
*Raiffeisen Capital Management stands for Raiffeisen Kapitalanalage-Gesellschaft m.b.H.